I have been using it for over half year now and was very happy with it. After I did today hear Steve Gibson mentioning (and recommending) it on Security Now!, I want to share my experience and add my vote of confidence.

The solution is Amazon S3 service (Simple Storage Service), fantastically affordable system to store your data securely on-line. You pay as you go - the size is unlimited and you are charged only for what you store and bandwidth you consume. Fantastically affordable means 15 cents for gigabyte-month storage and 10 cents for gigabyte transfer in / 18 cents for transfer out which will drop to 13 cents if you use it more. This means that to store my approximately 30 GB collection of pictures I need to upload them first (for $3) and then pay $4.50 monthly for storage - plus the download traffic. But of course, I am not using it for the images because I really need and like the nice album user interface which SmugMug provides. But to archive documents - this is just the perfect solution.

The S3 is focusing on developers and the service is accessible via Web service. You can choose from many available implementations for their API - in Java, Python, Perl, C#, VB, Ruby - you name it. For non programmers, there are client tools available that completely abstract the storage access and make the S3 appear as just another drive. From many clients avialable, I have selected (as well as Steve and Leo did) the Jungledisk. Unlike some other services that are trying to stand between you and your storage, take over not only data flow but more importantly money flow (and often charge fat premium), the good guys at Jungledisk just want to sell you the client and let you pay directly only Amazon fees to Amazon. The price for the client is just $20 - it is no-brainer. For this price you will get client version for all three major platforms (Mac, Linux, Windows) as well as source code of the "engine" part of the solution - in case you want to access same data through UI or programmatically.

After installation, the S3 will appear as another disc under windows or network volume on OS-X (I did not try Linux - yet). Jungledisk contains scheduler and can do automatic backup of defined parts of your disc to S3 - or you can use it for manual backup, as a very reliable and somehow slower external disc.

The big issue with remote storage of sensitive documents is security: can you really trust with your precious data to a third party (even if that part is Amazon) ? I think this is up to anyone to decide - but the S3 comes pretty close to my definition of secure-enough system and Jungledisk plays along very nicely. All traffic between you and Amazon is of course encrypted (SSL) and your data is stored as encrypted as well, by default using a private key that Amazon provides you. This allows key recovery - but also allows (in theory) that someone on Amazon side could read your files. If you want however, you can generate your own key pair and use it to encrypt the data - and all you need to do is properly configure your client Jungledisk. Or if you are really paranoid you can encrypt your data even before they even get to Jungledisk and Amazon - if you want to exchange convenience and easy of use for more security. In the last two cases, nobody on the earth will be able to read your files - but if you loose your key, you will need few million years to break it :-).

Give S3/JungleDisk a try - you may like it too ...
PS: If you are curious about performance and want more than my subjective feeling of "very reasonble" - read this.

PPS: The Smugmug actually *is* running on Amazon s3 - but because they use hundreds of terrabytes of space, obviously were able to get the storage for a wholesale price. The $59.95 / year membership of Smugmug would buy you on S3 about 15-25 GB storage and reasonable usage. As most people have less than 15 GB images, the Smugmug can actually make some money and employ really talented designers.